Telephone and Data Systems (NYSE:TDS) versus AST SpaceMobile (NASDAQ:ASTS) Head to Head Survey

Telephone and Data Systems (NYSE:TDS) and AST SpaceMobile (NASDAQ:ASTS) are both communication services companies, but which is the better investment? We will contrast the two businesses based on the strength of their valuation, dividends, earnings, risk, institutional ownership, profitability and analyst recommendations.

Analyst Ratings

This is a summary of recent ratings and target prices for Telephone and Data Systems and AST SpaceMobile, as provided by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Telephone and Data Systems	0	3	2	0	2.40
AST SpaceMobile	2	6	6	0	2.29

Telephone and Data Systems presently has a consensus price target of $47.50, indicating a potential upside of 40.45%. AST SpaceMobile has a consensus price target of $80.67, indicating a potential upside of 103.09%. Given AST SpaceMobile’s higher possible upside, analysts clearly believe AST SpaceMobile is more favorable than Telephone and Data Systems.

Profitability

This table compares Telephone and Data Systems and AST SpaceMobile’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Telephone and Data Systems	33.20%	11.97%	6.04%
AST SpaceMobile	-536.66%	-22.88%	-10.67%

Insider and Institutional Ownership

80.0% of Telephone and Data Systems shares are held by institutional investors. Comparatively, 61.0% of AST SpaceMobile shares are held by institutional investors. 14.2% of Telephone and Data Systems shares are held by insiders. Comparatively, 20.9% of AST SpaceMobile shares are held by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock is poised for long-term growth.

Volatility & Risk

Telephone and Data Systems has a beta of 0.32, indicating that its share price is 68% less volatile than the S&P 500. Comparatively, AST SpaceMobile has a beta of 2.72, indicating that its share price is 172% more volatile than the S&P 500.

Earnings & Valuation

This table compares Telephone and Data Systems and AST SpaceMobile”s revenue, earnings per share and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Telephone and Data Systems	$1.23 billion	3.17	-$6.24 million	$3.00	11.27
AST SpaceMobile	$70.92 million	217.97	-$341.94 million	($2.14)	-18.56

Telephone and Data Systems has higher revenue and earnings than AST SpaceMobile. AST SpaceMobile is trading at a lower price-to-earnings ratio than Telephone and Data Systems, indicating that it is currently the more affordable of the two stocks.

Summary

Telephone and Data Systems beats AST SpaceMobile on 9 of the 14 factors compared between the two stocks.

About Telephone and Data Systems

Telephone and Data Systems, Inc., a telecommunications company, provides communications services in the United States. It operates through two segments: UScellular and TDS Telecom. The company offers wireless solutions to consumers, and business and government customers, including a suite of connected Internet of things (IoT) solutions, and software applications for monitor and control, business automation/operations, communication, fleet and asset management, smart water solutions, private cellular networks and custom, and end-to-end IoT solutions; wireless priority services and quality priority and preemption options; smartphones and other handsets, tablets, wearables, mobile hotspots, fixed wireless home internet, and IoT devices; and accessories, such as cases, screen protectors, chargers, and memory cards, as well as consumer electronics, including audio, home automation and networking products. It also provides replace and repair services; Trade-In program through which it buys customers' used equipment; internet connections and all-home Wi-Fi services; TDS TV+, an integrated cloud television platform that offers video content and features; local and long-distance telephone service, voice over internet protocol, and enhanced services; broadband, IP-based services, and hosted voice and video collaboration services; and communication services in underserved areas. The company sells its products through retail stores, direct and indirect sales, third-party retailers, and independent agents, as well as through ecommerce and telesales. Telephone and Data Systems, Inc. was incorporated in 1968 and is headquartered in Chicago, Illinois.

About AST SpaceMobile

AST SpaceMobile, Inc., together with its subsidiaries, develops and provides access to a space-based cellular broadband network for smartphones in the United States. Its SpaceMobile service provides cellular broadband services to end-users who are out of terrestrial cellular coverage. The company was founded in 2017 and is headquartered in Midland, Texas.